Top Glove Earnings Outlook Likely Priced in After Recent Rally

Dow Jones
Yesterday

0105 GMT - Top Glove's improved earnings prospects are likely more than reflected in its share price following the recent rally, despite a more positive outlook for average selling prices, Maybank IB analyst Wong Wei Sum says in a note. Management guided higher average selling prices trend for October and November as Chinese glove makers show greater discipline and demand and supply become more balanced, she notes. Cost efficiencies should also support sustainable pretax margins of around 8%-12%, she says. However, potential minimum-wage increases could raise production costs. Wong raises Top Glove's FY2027-FY2028 earnings estimates by 113%-116%, as FY2026 earnings beat expectations. Maybank raises Top Glove's target price to 0.73 ringgit from 0.71 ringgit, while maintaining a sell rating. Shares are 2.3% higher at 0.90 ringgit.

 

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